Can Amazon's New FBA Returns Programs Help Sellers?

We recently wrote about a problem experienced by Amazon sellers who use its FBA fulfillment program. Sellers are frustrated that their customer returns are sometimes classified as "New" condition when returned to their sellable inventory despite missing parts or showing signs of damage missed by warehouse workers. This can be costly if a future customer receives one of their items in poor condition and reports it to Amazon, which will blame the seller.

Today, Amazon launched two new programs for sellers in its FBA fulfillment program designed to help them deal with the problem of returns.

The FBA Grade and Resell program will be available in the US by the end of the year and gives sellers the option of selling returned products on Amazon as "used" items instead of having the items sent back to them or donated.

"When an item is returned, sellers can choose to automatically route it to this new program. Amazon will then evaluate the item and assign it one of four standard conditions: Used - Like New, Used - Very Good, Used - Good, and Used - Acceptable," it explained. 

"Sellers then set the price for items based on the condition and manage pricing, advertising, and sales using their existing processes, just as they do for their new items."

FBA Grade and Resell is already available in the UK, and will be available in Germany, France, Italy and Spain by early 2022.

A second program, FBA Liquidations, gives sellers the option of using Amazon's existing wholesale liquidation partners and technology to recoup potential losses on returned and overstock inventory. The program is now live in U.S., Germany, France, Italy and Spain, and soon the UK.

Amazon didn't indicate the cost of the programs (we sent an inquiry late on Tuesday). In the UK, where the FBA Grade and Resell rolled out last month by invitation only, Amazon said it would waive processing fees for all inventory until December 31, 2021, and it explained how it works:

- You select items to submit to the programme from your eligible, unfulfillable inventory.

- Graded items are assigned a condition, such as Used - Like New, Used - Very Good, Used - Good , and Used - Acceptable, based on Amazon's condition guidelines.

- At the time of relisting, a processing fee will apply. No processing fee will apply for submitted items that are graded as Unsellable. These items will remain in your unfulfillable inventory.

- Once items are submitted to the programme, grading and relisting can take up to three weeks. However, this may be extended during peak selling times.

- A SKU is generated for your used listing under the parent ASIN.

- You set the price for your items based on the used condition. You manage pricing, advertising and sales using your existing processes, as you do for your new items.

- By participating in this programme, you agree to the FBA Grade and Resell terms and conditions.

Note that in the UK, at least, the program also requires a minimum calculated average sales price (ASP) of £15 in order for items to be eligible for the FBA Grade and Resell program.

Do the new programs solve the problem of items that are returned in less-than-perfect condition? Let us know what you think.

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